Free Notice of Filing Proposed Pretrial Order - District Court of Arizona - Arizona

Exhibit "G"

Case 2:04-cv-00384-ROS

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IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF ARIZONA
Meritage Homes Corporation, et aI.,
Plaintiffs,
v.

Case No. CV-04-0384-PHX-ROS

PROPOSED JURY INSTRUCTIONS

Ricky Lee Hancock, et aI.,
Defendants.

AND RELATED COUNTERCLAIMS AND TIDRD PARTY CLAIMS

Below is a list of proposed jury instructions followed by the proposed instrctions

- each on a separate page. Where the parties disagree, Plaintiffs' proposed instrction is
first followed by Defendants.

STIPULATED INSTRUCTIONS

Preliminary Instructions
1.lb Duty of Jury

1.2 Claims and Defenses
1.3 Burden of Proof-Preponderance of the Evidence
1.4 Burden of Proof-Clear and Convincing Evidence (if needed)

1.5 Two or More Parties-Different Legal Rights
1.6 What is Evidence

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1.7

What is Not Evidence

1.8
1.9

Evidence for LiITted Purpose
Direct and Circumstantial Evidence
Ruling on Objections

1.10
1.11

CredibHity of Witnesses

1.12
1.13

Conduct of the Jury
No Transcript Available to Jury
Taking Notes

1.14
1.18

Bench Conferences and Recesses

1.19 Outline of Trial

Instructions During Trial
1.12 Cautionary Instruction-First Recess

2.4 Deposition in Lieu of Live Testimony

1.8 Evidence for a LiITted Purose

2.1 0 Use of Interrogatories of a Party
2.11 Expert Opinion

Instructions at End of Case
1.6 What is Evidence
1.7 What is Not Evidence
1.9 Direct and Circumstantial Evidence
1.11 Credibility of Witnesses

2.11 Expert Opinion

Concluding Instructions - Jury Deliberation
3.1 Duty to Deliberate

3.2 Communication with Court
3.3 Return of Verdict

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Specific Claims
A. Claims Related To Olympic Conduct

Breach of Fiduciary Duty
. Fiduciary Duty - Plaintiff's Burden of Proof (Corporate Officer)

. Fiduciary Duty (Causation)

.. Fiduciary Duty (Measure of Damages)

. Punitive Damages

Usurpation of Corporate Opportunities
. Usurpation of Corporate Opportunities
. Corporate Opportunity - Definition (See Disputed Instructions)

. Damages
. Punitive Damages

Fraud in the.Concealment
. Elements

. Damages
. Punitive Damages

Breach of Contract
. Claims and Elements
. Definition and Formation of Contract
. Failure of Consideration (Material Breach)

. Measure of Direct Damages (Breach of Contract)

. Damages for Lost Profits

Breach of the Implied Covenant of Good Faith and Fair Dealing
. Good Faith and Fair Dealing

. Measure of Direct Damages

. Consequential Damages

. Damages for Lost Profits
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Unjust Enrichment
(no instrction)

B. Claims Related to the License A reement and Settin U

a ompetitor

Breach of Contract
(Same instructions as above)

Breach of Implied Covenant of Good Faith and Fair Dealing
(Same instructions as above)

Unjust Enrichment
(No instrction)

Conversion
. Claims and Elements

. Damages
. Punitive Damages

Intentional Interference with Contract
. Elements

. Damages
. Punitive Damages

Unfair Competition (Lanham Act)
. Definition - Trade Dress

. Infringement- Elements and Burden of Proof - Trade Dress
. Infringement - Elements - Trade Dress - Non Functionality

Requirement
. False Advertising - Burden of Proof and Elements

. Defendant's Profits
. Derivative Liability - Inducing a Violation

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Unfair Competitionlalming Off (State Law)
. General
. . PalITng or Passing Off

. PalITng or Passing Off - Aiding and Abetting Tortious Conduct

. Damages
. Puniti ve Damages

Misappropriation of Trade Secrets
. Trade Secrets - Essential Elements of Claim

. Aiding and Abetting Tortious Conduct
. Definition - Trade Secrets.

. Factors to be Considered

. Misappropriation

. Damages
. Punitive & Exemplary Damages

Intentional Interference with Prosepective Contractual Advantage
. Elements
. Aiding and Abetting Tortious Conduct

. Damages
. Punitive Damages

DISPUTED JURY INSTRUCTIONS

Plaintiff's Proposed Instructions
. Direct and Circumstantial Evidence
. Corporate Opportunity - Definition

Defendants' Proposed Instructions
. Direct and Circumstantial Evidence
. Corporate Opportunity - Definition

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DUTY

OF

JURY

Ladies and gentlemen: You are now the jury in this case. It is my duty to instruct
you on the law.

You must not infer from these instrctions or from anything I may say or do as indicating that I have an opinion regarding the evidence or what your verdict should be.
It is your duty to find the facts from all the evidence in the case. To those facts you wil apply the law as I give it to you. You must follow the law as I give it to you whether you agree with it or not. And you must not be influenced by any likes or dislikes, opinions, prejudices, or sympathy. That means that you personal must decide the case solely on the evidence before you. You wil recall that you took an oath-to do so.

In following my instrctions, you must follow all of them and no single out some
and ignore others; they are all important.

SOURCE: Ninth Circuit Model Civil Jury Instrctions 1.1E.

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CLAIMS AND DEFENSES

To help you follow the evidence, I wil give you a brief summary of the positions
of the parties:

The plaintiff claims that Defendant Greg Hancock, violated his employment agreement and breached fiduciary duties owed to Meritage while employed as President of its Hancock Communities division. Meritage's claims that Greg Hancock (1) violated certain provisions of the Lanham Act; (2) violated Arizona unfair competition law; (3) breached the fiduciary duty he owed to Meritage; (4) trade secrets; (5) intentionally interfered with Meritage's misappropriated prospective contractual advantage; (6) was unjustly enrched to the detriment of Mentage; (7) converted Merita~e's trade secrets to his own use; (8) breached contracts entered into with Mentage; (9) breach the implied covenant of good faith and fair dealing found within varous contracts entered into with Meritage; (10) commtted fraud in the concealment; and (11) usurped corporate opportunities for his own benefit. The plaintiff has the burden of proving these claims.

The plaintiff claims that Defendant J2H2 (1) intentionally interfered with the License Agreement entered into between, among others, Greg Hancock and of the Lanham Act; and (3) was unjustly Meritage; (2) violated certain provisions enriched to the detriment of Meritage. The plaintiff has the burden of proving these claims.

The defendants deny those claims and raise certain affirmative defenses. Greg Hancock asserts that he cancelled the License Agreement entered into between himself and Meritage. Greg Hancock has the burden of proving these affirmative defenses.
The plaintiff denies the affirmative defenses.
SOURCE: Ninth Circuit Model Civil Jury Instrctions 1.2 (modified by adding description of claims and defenses).

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BURDEN OF PROOF-PREPONDERANCE OF THE EVIDENCE

When a party has the burden of proof on any claim (or affirmative defense) by a preponderance of the evidence, it means you must be persuaded by the evidence
that the claim (or affirmative defense) is more probably true than not tre.

You should base your decision on all of the evidence, regardless of which party
presented it.

SOURCE: Ninth Circuit Model Civil Jury Instrctions 1.3.

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BURDEN OF PROOF-CLEAR AND CONVINCING EVIDENCE

When a party has the burden of proving any claim or defense by clear and convincing evidence, it means you must be persuaded by the evidence that the claim or defense is highly probable. This is a higher standard of proof than proof by a preponderance of the evidence.
You should base your decision on all presented it.of the evidence, regardless of which party . .

SOURCE: Ninth Circuit Model Civil Jury Instrctions 1.4.

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WHAT is EVIDENCE
The evidence you are to consider in deciding what the facts are consists of:

1. the sworn testimony of any witness;

2. the exhibits which are received in evidence; and
3. any facts to which the lawyers have agreed. SOURCE: Ninth Circuit Model Civil Jury Instrctions 1.6.

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WHAT is NOT EVIDENCE
In reaching you verdict, you may consider only the testimony and exhibits received in evidence. Certain things are not evidence, and you may not consider them in deciding what the facts are. i wil list them for you:

(1) Arguments and statements by lawyers are not evidence. The lawyers are not witnesses. What they have said in their opening statements, (wil say in their) closing arguments, and at other times is intended to help you interpret the evidence, but it is not evidence. If the facts as you remember them differ from the way the lawyers have stated them, your memory of
them controls.

(2) Questions and objections by lawyers are not evidence. Attorneys have a duty to their clients to object when they believe a question is improper
under the rules of evidence. You should not be influenced by the objection or by the court's ruling on it.

(3) Testimony that has been excluded or stricken, or that you have been instrcted to disregard, is not evidence and must not be considered. In addition sometimes testimony and exhibits are received only for a limited purpose; when i (give) (have given) a limiting instrction, you must follow
it.

(4) Anything you may have seen or heard when the court was not in sessions is not evidence. You are to decide the case solely on the evidence received at the tral.
SOURCE: Ninth Circuit Model Civil Jury Instructions 1.7.

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EVIDENCE FOR A LIMITED PURPOSE
Some evidence may be admitted for a limited purpose only.

When I instruct you that an item of evidence has been admitted for a limited purpose, you must consider it only for that limited purpose and for no other.
(The testimony (you are about to hear) (you have just heard) may be considered only for a limited purpose of (describe purpose) and for no other purpose.)

SOURCE: Ninth Circuit Model Civil Jury Instrctions 1.8.

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DIRECT AND CIRCUMSTANTIAL EVIDENCE

Disputed Instruction. See Plaintiffs' and Defendants' Proposed Instructions, infra.

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RULING ON OBJECTIONS

There are rules of evidence that control what can be received into evidence. When a lawyer asks a question or offers an exhibit into evidence and a lawyer on the other side thinks that it is not permitted by the rules of evidence, that lawyer may object. If I overrle the objection, the question may be answered or the exhibit received. If I sustain the objection, the question cannot be answered, and the exhibit cannot be received. Whenever I sustain an objection to a question, you must ignore the question and must not guess what the answer might have been. Sometimes I may order that evidence be strcken from the record and that you disregard or ignore the evidence. That means that when you are deciding the case, you must not consider the evidence that I told you to disregard.
SOURCE: Ninth Circuit Model Civil Jury Instrctions 1.10.

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CREDIBILITY OF WITNESSES

In deciding the facts in this case, you may have to decide which testimony to believe and which testimony not to believe. You may believe everything a witness says, or part of it, or none of it. Proof of a fact does not necessarily depend on the number of witnesses who testify about it.
In considering the testimony of any witness, you may take into account:
testified to;

(1) the opportunity and ability of the witness to see or hear or know the things

(2) the witness's memory;
(3) the witness's manner while testifying;

(4) the witness's interest in the outcome of the case and any bias or prejudice; (5) whether other evidence contradicted the witness's testimony; (6) the reasonableness of the witness's testimony in light of all the evidence; and

(7) any other facts that bear on believabilty.
The weight of the evidence as to a fact does not necessarly depend on the number of witnesses who testify about it.
SOURCE: Ninth Circuit Model Civil Jury Instrctions 1.11.

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CONDUCTOF THE JURY

I wil now say a few words about your conduct as jurors.
First, you are not to discuss this case with anyone, including members of your family, people involved in the trial, or anyone else; this includes discussing the case in Internet chat rooms or through internet "blogs," internet bulletin boards or e-mails. Nor are you allowed to permt other to discuss the case with you. If anyone approaches you and tres to talk to you about the case, please let me know about it immediately.
Second, do not read or listen to any news stories, articles, radio, television, or online reports about the case or about anyone who has anything to do with it;

Third, do not do any research, such as consulting dictionaries, searching the Internet or using other reference materials, and do not make any investigation about the case on your own; Fourth, if you need to communicate with me simply give a signed note to the (bailff) (clerk) (law clerk) to give to me; and
Fifth, do not make up your mind about what the verdict should be until after you have gone to the jury room to decide the case and you and your fellow jurors have
discussed the evidence. Keep an open mind until then.

Finally, until this case is given to you for your deliberation and verdict, you are not to discuss the case with your fellow jurors.

SOURCE: Ninth Circuit Model Civil Jury Instrctions 1.12.

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NO TRANSCRIPT AVAILABLE TO JURY

During deliberations, you wil have to make your decision based on what you recall of the evidence. You wil not have a transcript of the tral. I urge you to
pay close attention to the testimony as it is given.

If at any time you cannot hear or see the testimony, evidence, questions or arguments, let me know so that I can correct the problem.

SOURCE: Ninth Circuit Model Civil Jury Instrctions 1.13.

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TAKING

NOTES

If you wish, you may take notes to help you remember the evidence. If you do take notes, please keep them to yourself until you and your fellow jurors go to the jury room to decide the case. Do not let note-takng distract you. When you leave, your notes should be left in (courtroom) Uury room) (envelope in the jury room). No one wil read your notes. They wil be destroyed at the conclusion of

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Whether or not you take notes, you should rely on your own memory of the evidence. Notes are only to assist your memory. You should not be overly influenced by your notes or those of your fellow jurors.

SOURCE: Ninth Circuit Model Civil Jury Instrctions 1.14.

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BENCH CONFERENCES AND RECESSES

From time to time during the trial, it (may become) (became) necessary for me to talk with the attorneys out of the hearng of the jury, either by having a conference at the bench when the jury (is) (was) present in the courtroom, or by callng a recess. Please understand that while you (are) (were) waiting, we (are) (were) working. The purpose of these conferences is not to keep relevant information from you, but to decide how certain evidence is to be treated under the rules of evidence and to avoid confusion and error.

Of course, we (wil do) (have done) what we (can) (could) to keep the number and conferences to a minimum. I (may) (did) not always grant an length of these attorney's request for a conference: Do not consider my granting or denying a request for a conference as any indication of my opinion of the case or of what your verdict should be.
SOURCE: Ninth Circuit Model Civil Jury Instrctions 1.18.

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OUTLINE OF TRIAL

Trials proceed in the following way: First, each side may make an opening statement. An opening statement is not evidence. It is simply an outline to help you understand what that party expects the evidence wil show. A party is not required to make an opening statement. The plaintiff wil then present evidence, and counsel for the defendant may crossexamine. Then the defendant may present evidence, and counsel for the plaintiff may cross examine. After the evidence has been presented, I wil instruct you on the law that applies to the case and the attorneys will make closing arguments.
After that, you wil go to the jury room to deliberate on your verdict.
SOURCE: Ninth Circuit Model Civil Jury Instrctions 1.19.

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CAUTIONARY INSTRUCTION-FIRST RECESS

I wil now say a few words about your conduct as juror.
First, you are not to discuss this case with anyone, including members of your family, people involved in the tral, or anyone else; this includes discussing the case in internet chat rooms or through internet "blogs," internet bulletin boards or e-mails. Nor are you allowed to permt other to discuss the case with you. If anyone approaches you and tries to talk to you about the case, please let me know about it immediately.

Second, do not read or listen to any news stories, articles, radio, television, or online reports about the case or about anyone who has anything to do with it;

Third, do not do any research, such as consulting dictionaries, searching the Internet or using other reference materials, and do not make any investigation about the case on your own;
Fourth, if you need to communicate with me

simply give a signed not to the clerk

to give to me; and

Fifth, do not make up your mind about what the verdict should be until after you have gone to the jury room to decide the case and you and your fellow jurors have
discussed the evidence. Keep an open mind until then.

Finally, until this case is given to you for your deliberation and verdict, you are not to discuss the case with your fellow jurors.

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DEPOSITION IN LIEU OF LIVE TESTIMONY
A deposition is the sworn testimony of a witness taken before tral. The witness is

placed under oath to tell the trth and lawyers for each party may ask questions. The questions and answers are recorded. When a person is unavailable to testify at tral, the deposition of that person may be used at the triaL.
The deposition of (witness) was taken on (date). You should

consider the

deposition testimony, presented to you in court in lieu of live testimony, insofar as possible, in the same way as if the witness had been present to testify.
(Do not place any significance on the behavior or tone of voice of any person
reading the questions or answers.)

SOURCE: Ninth Circuit Model Civil Jury Instructions 2.4.

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USE OF INTERROGATORIES OF A PARTY

Evidence (wil now be) (was) presented to you in the form of answers of one of the parties to written interrogatories submitted by the other side. These answers (have been) (were) given in writing and under oath, before the actual trial, in response to questions that were submitted in writing under established court insofar as possible, in the same way procedures. You should consider the answers, as if they were made from the witness stand.
SOURCE: Ninth Circuit Model Civil Jury Instrctions 2.10.

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EXPERT OPINION

Some witnesses, because of education or experience, are permitted to state opinions and the reasons for those opinions.

Opinion testimony should be judged just like any other testimony. You may accept it or reject it, and give it as much weight as you think it deserves, considering the witness's education and experience, the reasons given for the opinion, and all the other evidence in the case.
SOURCE: Ninth Circuit Model Civil Jury Instrctions 2.11.

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DUTY TO DELIBERATE

When you begin your deliberations, you should elect one member of the jury as
your presiding

juror. That person wil preside over the deliberations and speak for

you here in court.

You wil then discuss the case with your fellow jurors to reach agreement if you can do so. Your verdict must be unanimous.
Each of you must decide the case for yourself, but you should do so only after you have considered all of the evidence, discussed it fully with other jurors, and listened to the views of your fellow jurors. Do not hesitate to change your opinion if the discussion persuades you that you should. Do not come to a decision simply because other jurors think its right.

It is important that you attempt to reach a unanimous verdict but, of course, only if each of you can do so after having made your own conscientious decision. Do not change an honest belief about the weight and effect of the evidence simply to reach a verdict.
SOURCE: Ninth Circuit Model Civil Jury Instrctions 3.1. .

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COMMUNICATION WITH COURT

If it becomes necessary during your deliberations to communicate with me, you may send a note through the (marshal) (bailff), signed by your presiding juror or by one or more members of the jury. No member of the jury should ever attempt to communicate with me except by a signed writing; I wil communicate with any concerning the case only in writing, or here in member ofthe jury on anything open court. If you send out a question, I wil consult with the parties before answerin~ it, which may take some time. You may continue your deliberations while waIting for the answer to any question. Remember that you are not to tell anyone-including me-how the Jury stands, numerically or otherwise, until after you have reached a unanimous verdict or have been discharged. Do not disclose any vote count in any note to the court.

SOURCE: Ninth Circuit Model Civil Jury Instrctions 3.2.

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RETURN OF VERDICT
A verdict form has been prepared for you. (An ex lanation 0 the verdict orm

may be given at this time.) After you have reache unanimous agreement on a verdict, your presiding juror wil fil in the form that has been given to you, sign and date it, and advise the court that you are ready to return to the courtroom.
SOURCE: Ninth Circuit Model Civil Jury Instructions 3.3.

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CLAIMS RELATED TO OLYMPIC CONDUCT

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BREACH OF FIDUCIARY DUTY FIDUCIARY DUTY-PLAINTIFFS BURDEN OF PROOF
(CORPORATE OFFICER)

Greg Hancock was a corporate officer of Mentage. Corporate officers owe a special duty to the corporation, which is called a fiduciary duty. This duty requires the corporate officer to deal in utmost good faith with the corporation.
Meritage claims that Greg Hancock breached this fiduciary duty. To establish this claim, Meritage must prove:
1. Greg Hancock breached this duty;
2. Greg Hancock's

breach was a cause of Meritage's damages; and

3. Meritage's damages.

SOURCE: RAJI (Civil) 4th Commercial Torts 1D (modified by adding the name of the defendant and plaintiff and by replacing the term "partner" with "corporate officer" and "partnership" with the term
"corporation ").

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BREACH OF FIDUCIARY DUTY FIDUCIARY DUTY (Causation)
Before you can find Greg Hancock liable on the breach of fiduciary duty claim, you must find that Greg Hancock's breach of fiduciary duty was a cause of Meritage's damages.

A breach of fiduciary duty is a cause of damages if it helps produce the damages and if the damages would not have occurred without the breach.

SOURCE: RAJ! (Civil) 4th Commercial Torts 2 (modified by adding name of defendant and plaintiff to the instruction and by including bracket language suggested in RAJ! (Civil) 4th Commercial Torts 2).

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BREACH OF FIDUCIARY DUTY FIDUCIARY DUTY (Measure of Damages)

If you find that Greg Hancock is liable to Meritage on the breach of fiduciary duty claim, you must then decide the full amount of money that wil reasonably and fairly compensate Meritage for any of the following elements of damage proved by the evidence to have resulted from Greg Hancock's breach of this duty:
1.

Loss of money or other property.

2.
3.

The profit or proceeds that Meritage would have received had Greg Hancock performed his duties.
Money or property that is unjust for Greg Hancock to keep.

SOURCE: RAJ! (Civil) 4th Commercial Torts 3 (modified by (1) adding name of defendant and plaintiff to the instrction; (2) by including bracket language suggestedin RAJ! (Civil) 4th Commercial Torts 3 because additional claims exist beyond breach of fiduciary duty; and (3) by excluding elements of damage due to bodily har and emotional
distress).

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.BREACH

OF FIDUCIARY DUTY PUNITIVE DAMAGES

If you find Greg Hancock liable to Meritage, you may consider assessing additional damages to punish Greg Hancock or to deter Greg Hancock and others from similar misconduct in the future. Such damages are called "punitive" or "exemplary" damages.

To recover such damages, Meritage has the burden of proving by clear and convincing evidence, either direct or circumstantial, that Greg Hancock acted with an evil mind.
This required state of mind may be shown by any of the following:
1. Intent to cause injury; or

2. Wrongful conduct motivated by spite or il wil; or
3. Greg Hancock acted to

serve his own interests, having reason to know and consciously disregardin~ a substantial risk that his conduct might significantly injure the rights of others.

To prove this required state of mind by clear and convincing evidence, Meritage must persuade you that the punitive damages claim is highly probable. This burden of proof is more demanding that then standard of more probably true than not tre, which applies to all other claims in this case, but is less demanding that the standard of proof beyond a reasonable doubt, which is used in criminal cases.

The law provides no fixed standard for the amount of punitive damages you may assess, if any, but leaves the amount to your discretion. However, if you assess punitive damages, you may consider the character of Greg Hancock's conduct or motive, the nature and extent of the har to plaintiff that Greg Hancock caused, and the nature and extent of Greg Hancock's financial wealth.
SOURCE: RAJ! (Civil) 4th PERSONAL INJURY DAMAGES 4 (modified by (1) adding party names and (2) by including bracketed language recommended within Personal Injury Damages 4).

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USURPATION OF CORPORATE OPPORTUNITIES Meritage claims that Greg Hancock improperly usurped corporate opportunities that should have been offered to Meritage.
To establish this claim, Meritage must prove:
(1) that Greg Hancock was a senior executive at Meritage; and
(2) that Greg Hancock benefited from taking advantage of a corporate

opportunity without first disclosing the opportunity to Meritage;
also prove that the opportunity was not rejected by Meritage;

(3) if the corporate opportunity was presented to Meritage, then Meritage must

(4) that Greg Hancock's taking of the corporate opportunity resulted in lost
opportunity and/or damaged Meritage.

SOURCE: Principles of Corporate Governance: Analysis and
Recommendations § 5.05. .

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USURPATION OF CORPORATE OPPORTUNITIES CORPORATE OPPORTUNITY - DEFINITION
Disputed instrction. See Plaitiff's and Defendants' Proposed Instrctions, infra.

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USURPATION OF CORPORATE OPPORTUNITIES DAMAGES

If you find that Greg Hancock is liable to Meritage on the Usurpation of Corporate
Opportunities claim, you must then decide the full amount of money that wil -

reasonably and fairly compensate Meritage for any of the following elements of damages proved by the evidence to have resulted from Greg Hancock's usurpation of Meritage's corporate opportunities:
1. Loss of money or other property;
2. The profit or proceeds that Meritage would have received had Greg

Hancock not usurped Meritage's corporate opportunities;
3. Money or property that is unjust for Greg Hancock to keep.
SOURCE: RAJ! (Civil) 4th Commercial Torts 3 (modified by (1) adding

party names and (2) by conformng language to Usurpation of Corporate
Opportunities claim).

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USURPATION OF CORPORATE OPPORTUNITIES PUNITIVE DAMAGES

If you find Greg Hancock liable to Meritage, you may consider assessing additional damages to punish Greg Hancock or to deter Greg Hancock and others from similar misconduct in the future. Such damages are called "punitive" or "exemplary" damages.

To recover such damages, Meritage has the burden of proving by clear and convincing evidence, either direct or circumstantial, that Greg Hancock acted with an evil mind.
This required state of mind may be shown by any of the following:
1. Intent to cause injury; or

2. Wrongful conduct motivated by spite or il wil; or

3. Greg Hancock acted to serve his own interests, having reason to know and
consciously disregardin~ a substantial risk that his conduct might significantly injure the nghts of others.

To prove this required state of mind by clear and convincing evidence, Meritage must persuade you that the punitive damages claim is highly probable. This burden of proof is more demanding that then standard of more probably tre than not tre, which applies to all other claims in this case, but is less demanding that the standard of proof beyond a reasonable doubt, which is used in criminal cases. The law provides no fixed standard for the amount of punitive damages you may assess, if any, but leaves the amount to your discretion. However, if you assess punitive damages, you may consider the character of Greg Hancock's conduct or motive, the nature and extent of the har to plaintiff that Greg Hancock caused, and the nature and extent of Greg Hancock's financial wealth.
SOURCE: RAJI (Civil) 4th PERSONAL INJURY DAMAGES 4 (modified by (1) adding party names and (2) by including bracketed language recommended within Personal Injury Damages 4).

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FRAUD IN THE CONCEALMENT ELEMENTS
Meritage claims that Greg Hancock commtted fraud in the concealment. To

establish this claim, Meritage must prove by clear and convincing evidence:
1. Greg Hancock concealed his competing business activities while employed
by Meritage.

2. Greg Hancock was under a duty to refrain from concealing.
3. Gre~ Hancock's concealment was material, which means that it was

sufficiently important to influence Meritage' s actions.
4. Greg Hancock failed to reveal that which he knew he had a duty to reveaL.

5. Greg Hancock intended that Meritage would act upon the concealment in the manner reasonably contemplated by Greg Hancock.
6. Meritage did not know about the matters which were not revealed.
7. Meritage relied upon the assumption that Greg Hancock had revealed all.
8. Meritage's reliance was reasonable and

justified under the circumstances.

and
9. As a result, Meritage was damaged.

SOURCE: RAJI (Civil) 4th Commercial Torts 24 (modified by (1) using party names and (2) using language conformng with fraudulent concealment claim); Raisch v. Allstate Ins. Co., 197 Ariz. 606, 5 P.3d 940 (Ariz. App. 2000).

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FRUD IN THE CONCEALMENT DAMAGES
If you find that Greg Hancock is liable to Meritage on the Fraud in the Concealment Claim, you must then decide the full amount of money that wil reasonably and fairly compensate Meritage for damages proved by the evidence to have resulted from Greg Hancock's concealment.

SOURCE: RAJ! (Civil) 4th Commercial Torts 22 (modified by (1) adding party names and (2) by using bracket language suggested for fraud in the concealment).

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FRAUD IN THE CONCEALMENT PUNITIVE DAMAGES

If you find Greg Hancock liable to Meritage, you may consider assessing additional damages to punish Greg Hancock or to deter Greg Hancock and others from similar misconduct in the future. Such damages are called "punitive" or

"exemplary" damages. .

To recover such damages, Meritage has the burden of proving by clear and convincing evidence, either direct or circumstantial, that Greg Hancock acted with an evil mind.
This required state of mind may be shown by any of the following:
1. Intent to cause injury; or

2. Wrongful conduct motivated by spite or il wil; or

3. Greg Hancock acted to serve his own interests, having reason to know and
consciously disregardin~ a substantial risk that his conduct might
significantly injure the nghts of others. .
To prove this required state of mind by clear and convincing evidence, Meritage

must persuade you that the punitive damages claim is highly probable. This burden of proof is more demanding that then standard of more probably tre than not true, which applies to all other claims in this case, but is less demanding that the standard of proof beyond a reasonable doubt, which is used in criminal cases.
The law provides no fixed standard for the amount of punitive damages you may assess, if any, but leaves the amount to your discretion. However, if you assess punitive damages, you may consider the character of Greg Hancock's conduct or motive, the nature and extent of the har to plaintiff that Greg Hancock caused, and the nature and extent of Greg Hancock's financial wealth.
SOURCE: RAJ! (Civil) 4th PERSONAL INJURY DAMAGES 4 (modified by (1) adding party names and (2) by including bracketed language recommended within Personal Injury Damages 4).

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BREACH OF CONTRACT CLAIMS AND ELEMENTS

Meritage claims that Greg Hancock breached a contract. On this claim, Meritage must prove there was a contract with Greg Hancock and Greg Hancock breached the contract.

SOURCE: RAJI (Civil) 4th Contract 2 (modified by (1) adding party names; and (2) by omitting bracketed language regarding affirmative
defenses).

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BREACH OF CONTRACT DEFINITION AND FORMATION OF CONTRACT

A contract is an agreement between two or more persons or entities. For a contract to exist, there must be an offer, acceptance of the offer, and consideration.
To find that the parties had a contract, you must find that they each intended to be bound by the agreement, and that they made that intention known to the other ' party.

SOURCE: RAJ! (Civil) 4th Contract 3 (modified by (1) including bracketed language included in RAJ! (Civil) 4th Contract 3).

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BREACH OF CONTRACT FAILURE OF CONSIDERATION (MATERIAL BREACH)

Meritage contends that there has been a material breach of the Master Transaction Agreement, the Agreement of Purchase and Sale of Assets, the License Agreement, and Greg Hancock's Employment Agreement with Meritage. Material breach occurs when a party fails to do something required by the contract which is so important to the contract that the breach defeats the very purpose of
the contract.
Meritage has the burden of proving the material'

breach.

Material breach by one party excuses performance by the other party to the contract.

SOURCE: RAJ! (Civil) 4th Contract 9 (modified by (1) using party names; (2) by using bracketed language for material breach; and (3) identifying the agreements).

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BREACH OF CONTRACT MEASURE OF DIRECT DAMAGES (Breach of Contract)

If you find that Greg Hancock is liable to Meritage for breach of contract, you must decide the full amount of money that wil reasonably and fairly compensate Meritage for the damages ¡roved by the evidence to have resulted naturally and directly from the breach 0 contract. The damages you award for breach of contract must be the amount of money that wil place Meritage in the position Meritage would have been in if the contract had been peiformed. To determne those damages, you should consider the following:

The profit that Meritage would have received had the contract been performed;

The return of the value of the things or services that Meritage provided to Greg Hancock;
The value of

things or services expended by Meritage in preparng to perform its part of the contract or in preparng to accept the benefits of Greg Hancock's expected performance;

Whether Meritage, by not having to perform its part of the contract, has avoided

any cost which should be deducted from its damages. .
(Civil) 4th Contract 17).

SOURCE: RAn (Civil) 4th Contract 17 (modified by (1) using party names; and (2) by using suggested bracketed language contained in RAn

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BREACH OF CONTRACT DAMAGES FOR LOST PROFITS

Meritage also seeks to recover damages for lost profits. To recover damages for present or future lost profits, Meritage must prove:
1. That it is reasonably probable that the profits would have been earned

except for the breach;
2. That the loss of profits is the direct and natural consequence of the breach;

and 3. The amount of lost profits can be shown with reasonable certainty.

If future lost profits are reasonably certain, any reasonable basis for determning
the amount of the probable profits lost is acceptable. However, the

amount of lost

profits cannot be based on conjecture or speculation.

In determining whether and to what extent Meritage proved lost profits, you must subtract the costs and expense Meritage would have incurred from the gross revenue Meritage would have received if the contract had not been breached.

SOURCE: RAn (Civil) 4th Contract 19 (modified by using party names).

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BREACH OF THE IMPLIED COVENANT FAITH AND FAIR DEALING OF GOOD GOOD FAITH AND FAIR DEALING

A party to a contract has a duty to act fairly and in good faith. This duty is implied by law and need not be in writing.
This duty requires that neither party do anything that prevents the other party from receiving the benefit of their agreement. If you find that Greg Hancock has breached the duty of good faith and fair dealing of Purchase with respect to the the Master Transaction Agreement, the Agreement and Sale of Assets, the License Agreement, and Greg Hancock's Employment Agreement with Meritage; Meritage is entitled to recover damages proved by the evidence to have resulted naturally and directly from the breach and to recover consequential damages.

SOURCE: RAJ! (Civil) 4th Contract 16 (modified by (1) using pary names; (2) including bracketed language suggest by RAJ! (Civil) 4th Contract 16; and (3) identifying the contracts).

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BREACH OF THE IMPLIED COVENANT OF GOOD FAITH AND FAIR DEALING MEASURE OF DIRECT DAMAGES (Breach of the Implied Covenant of Good Faith and Fair Dealing)

If you find that Greg Hancock is liable to Meritage for breach of the implied covenant of good faith and fair dealing, you must decide the full amount of money that wil reasonably and fairly compensate Meritage forthe damages proved by the evidence to have resulted naturally and directly from the breach of the implied covenant of good faith and fair dealin~. The damages you award for breach of the imtilied covenant of good faith and fair dealing must be the amount of money that
wi 1 place Meritage in the position Meritage would have been in if the contract had been performed. To determne those damages, you should consider the following:

The profit that Meritage would have received had the contract been performed;

The return of the value of the things or services that Meritage provided to Greg Hancock;

The value of things or services expended by Meritage in preparng to perform its part of the contract or in preparng to accept the benefits of Greg Hancock's

expected performance; ..

Whether Meritage, by not having to perform its part of the contract, has avoided any cost which should be deducted from its damages.

SOURCE: RAJI (Civil) 4th Contract 17 (modified by (1) using party names; (2) by using suggested bracketed language contained in RAJI (Civil) 4th Contraçt 17; and (3) by using language to conform with Count IX: Breach of the Implied Covenant of Good Faith and Fair Dealing).

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BREACH OF THE IMPLIED COVENANT OF GOOD FAITH AND FAIR DEALING CONSEQUENTIAL DAMAGES
Meritage also seeks to

recover dama~es for (items determned by court to be

consequential in nature rather than direct).

To recover for these alleged damages, Meritage must prove:
I. It was foreseeable to the parties when they entered into the contract that

these damages would probably result if the contract was breached;
2. These damages were in fact caused by Greg Hancock's breach of the

contract; and
3. The amount of the damages.

SOURCE: RAJI (Civil) 4th Contract 18 (modified by using party names).

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BREACH OF THE IMPLIED COVENANT. OF GOOD FAITH AND FAIR DEALING DAMAGES FOR LOST PROFITS
Meritage also seeks to recover damages for lost profits. To recover damages for present or future lost profits, Meritage must prove:
1. That it is reasonably probable that the profits would have been earned

except for the breach;
2. That the loss of profits is the direct and natural consequence of the breach;

and

3. The amount of lost profits can be shown with reasonable certainty.

If future lost profits are reasonably certain, any reasonable basis for determning the amount of the probable profits lost is acceptable. However, the amount of lost
profits cannot be based on conjecture or speculation. .

In determining whether and to what extent Meritage proved lost profits, you must subtract the costs and expense Meritage would have incurred from the gross revenue Meritage would have received if the contract had not been breached.

SOURCE: RAn (Civil) 4th Contract 19 (modified by using party names).

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UNJUST ENRICHMENT

THE UNJUST ENRICHMENT CLAIMS ARE EQUITABLE CLAIMS TO BE TRIED BEFORE THE COURT

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CLAIMS RELATED TO THE LICENSE AGREEMENT AND SETTING UP A COMPETITOR

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BREACH OF CONTRACT
(INSTRUCTION AVAILABLE ABOVE)

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BREACH OF IMPLIED COVENANT OF GOOD FAITH AND FAIR DEALING
(INSTRUCTION AVAILABLE ABOVE)

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UNJUST ENRICHMENT

THE UNJUST ENRICHMENT CLAIMS ARE EQUITABLE CLAIMS TO BE TRIED BEFORE THE COURT

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CONVERSION CLAIM AND ELEMENTS
Meritage claims that Defendant Greg Hancock commtted conversion against

Meritage. To prove conversion, Meritage must prove it had the right to immediate possession or control of certain trade names. If you find that Meritage did not have the right to immediate possession or control, then you must find for the Defendant. If Meritage has the right to immediate possession or control, then you must determine whether Defendant Greg Hancock Intentionally exercised wrongful dominion or control over the property of Meritage that was inconsistent with the rights of Meritage. If you find that Defendant Greg Hancock intentionally exercised wrongful dominion or control over the property of Meritage that was inconsistent with the rights of Meritage then Greg Hancock is liable for conversion. If you find that the defendant did not exercise dominion or control over Meritage's property, you must find for the Defendants

SOURCE: Sharter v. Ulmer, 85 Ariz. 179,333 P2d 1084 (1959); Sears
P.2d 1032, 1034 (App. 1990).

Consumer Fin. Corp. v. Thunderbird Prod., 166 Ariz. 333, 335, 802

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CONVERSION DAMAGES

If you find that Meritage is entitled to recover damages for conversion, you should award Meritage:
(l) the valu'e of the property at the time of the conversion, with interest from

the time of conversion; or

(2) an amount sufficient to compensate Merita~e for natural and reasonable

losses caused by the wrongful act upon which you base your finding of liability, and which ordinary prudence on Meritage's part would not have
been avoided.

SOURCE: Wolk v. Nichols, 117 Ariz. 352, 572 P.2d 1190 (Ariz. 1977).

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CONVERSION . PUNITIVE DAMAGES
If you find Greg Hancock liable to Meritage, you may consider assessing additional damages to punish Greg Hancock or to deter Greg Hancock and others from similar misconduct in the future. Such damages are called "punitive" or
"exemplary" damages.

To recover such damages, Meritage has the burden of proving by clear and convincing evidence, either direct or circumstantial, that Greg Hancock acted with an evil mind.
This required state of mind may be shown by any of the following:
i. Intent to cause injury; or

2. Wrongful conduct motivated by spite or il wil; or

3. Greg Hancock acted to serve his own interests, having reason to know and
consciously disregardin~ a substantial risk that his conduct might significantly injure the nghts of others.

To prove this required state of mind by clear and convincing evidence, Meritage must persuade you that the punitive damages claim is highly probable. This burden of proof is more demanding that then standard of more probably trethan not tre, which applies to all other claims in this case, but is less demanding that the standard of proof beyond a reasonable doubt, which is used in criminal cases.
The law provides no fixed standard for the amount of punitive damages you may assess, if any, but leaves the amount to your discretion. However, if you assess punitive damages, you may consider the character of Greg Hancock's conduct or motive, the nature and extent of the har to plaintiff that Greg Hancock caused, and the nature and extent of Greg Hancock's financial wealth.
SOURCE: RAn (Civil) 4th PERSONAL INJURY DAMAGES 4 (modified by (1) adding party names and (2) by including bracketed language recommended within Personal Injury Damages 4).

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INTENTIONAL INTERFRENCE WITH CONTRACT INTERFERENCE WITH CONTRACT (Elements)
Meritage claims that Defendant J2H2 improperly interfered with non:-compete and license agreements entered into between Meritage and Greg Hancock.

To establish this claim, Meritage must prove:
1. Meritage had entered into noncompete and license agreement with Greg

Hancock;
2. J2H2 knew about the agreements;

3. J2H2 intentionally interfered with Meritage's contractual relationship, which caused a breach of that relationship;
4. J2H2's conduct was improper; and
5. Meritage suffered damage cause by the breach of Meritage's contractual

relationships.

SOURCE: RAJI (Civil) 4th Employment Law 14 (modified by (1) using party names and (2) by using language conformng to the agreements at
issue).

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INTENTIONAL INTERFRENCE WITH AGREEMENT INTERFRENCE WITH CONTRACT (Damages)
If you find that J2H2 improperly interfered with Meritage's license andnoncompete agreements, you must then decide the full amount of money that wil reasonably and fairly compensate Meritage for each of the following elements of damages proved by the evidence to have resulted from the interference with the contract.
1. The net profit that Meritage would have received had the contract been

performed; and

2. Damage to Meritage' s reputation.

SOURCE: RAJI (Civil) 4th Employment Law 15 (modified by (1) using party names; (2) by using language conformng to the agreements at issue; and (3) by omitting damages based on emotional suffering).

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INTENTIONAL INTERFRENCE WITH AGREEMENT INTERFRENCE WITH CONTRACT (Punitive Damages)
If you find J2H2 liable to Meritage, you may consider assessing additional damages to punish J2H2 or to deter J2H2 and others from similar misconduct in the future. Such damages are called "punitive" or "exemplary" damages.

To recover such damages, Meritage has the burden of proving by clear and
convincing evidence, either direct or circumstantial, that J2H2 acted with an evil mind.

This required state of mind may be shown by any of the following:
1. Intent to cause injury; or

2. Wrongful conduct motivated by spite or ill wil; or

3. J2H2 acted to serve his own interests, having reason to know and.
consciously disregardin~ a substantial risk that his conduct might significantly injure the nghts of others.

To prove this required state of mind by clear and convincing evidence, Meritage must persuade you that the punitive damages claim is highly probable. This burden of proof is more demanding that then standard of more probably true than not true, which applies to all other claims in this case, but is less demanding that the standard of proof beyond a reasonable doubt, which is used in criminal cases.
The law provides no fixed

standard for the amount of punitive damages you may assess, if any, but leaves the amount to your discretion. However, if you assess punitive damages, you may consider the character of J2H2's conduct or motive, the nature and extent of the har to plaintiff that J2H2 caused, and the nature and

extent of J2H2's financial wealth. . .
SOURCE: RAJI (Civil) 4th PERSONAL INJURY DAMAGES 4 (modified by (1) adding party names and (2) by including bracketed language recommended within Personal Injury Damages 4).

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UNFAIR COMPETITION (LANHAM ACT) DEFINITION-TRADE DRESS

Trade dress is the non-functional physical details and design of a product or its packaging, which indicates or identifies the product's source and distinguishes it from the products of others.

Trade dress is the product's total image and overall appearance, and may include features such as size, shape, color, color combinations, texture, or graphics. In other words, trade dress is the form in which a person presents a product or service

to the market, its manner of display. .

A trade dress is non-functional if, taken as a whole, the collection of trade dress elements is not essential to the product's use or purpose even though certain
particular elements of the trade dress may be functionaL.

In this case, you wil hear evidence about the manner in which Meritage identifies its business and the product or services it sells. This is the total image of the business, suggested by the general shape and appearance of its business, such as its identifying signs, interior floor space, décor, equipment, dress of employees, and other features reflecting on the total image of the business.
A person who uses the trade dress of another may be liable for damages.
SOURCE: Ninth Circuit Model Civil Jury Instructions 15.2 (Modified by (1) ~sin~ part~ nai:es; (2) by. u~ing suggested. bracketed language found
in Ninth Circuit Model Civil Jury Instrctions 15.2; and by (3)

including language suggested for cases involving business image).

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UNFAIR COMPETITION (LANHAM ACT) INFRINGEMENT-ELEMENTS AND BURDEN OF PROOF-TRADE DRESS

On Meritage's claim for trade dress infringement, Meritage has the burden of proving by a preponderance of the evidence each of the following elements:
1. (describe the plaintiff's trade dress) is distinctive;

2. Meritage owns (describe the trade dress) as trade dress;
3. the (describe the trade dress) is nonfunctional;

4. Greg Hancock and/or J2H2 used (describe trade dress used by the
defendant) without the consent of Meritage in a manner that is likely to cause confusion among ordinary purchasers as to the source of Mentage's goods; and
5. Meritage was damaged by Greg Hancock and/or J2H2's infringement.

If you find that each of the elements on which Meritage has the burden of proof has been proved, your verdict should be for Meritage. If, on the other hand, Meritage has failed to prove any of these elements, your verdict should be for Greg Hancock and/or J2H2.
SOURCE: Ninth Circuit Model Civil Jury Instrctions 15.6 (Modified by (1)
using party names and (2) by including description of Meritage' s

trade dress and the trade dress using by the defendant).

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INFRINGEMENT -ELEMENTS-V ALIDITY -TRADE DRESS-NON
FUNCTIONA,LITY REQUIREMENT

UNFAIR COMPETITION (LANHAM ACT)

A Product feature is functional if it is essential to the product's use or purpose, or if it affects the l.roduct's cost or quality. It is non-functional if its shape or form makes no contnbution to the product's function or operation. If the feature is part of the actual benefit that consumers wish to purchase when they buy the product, the feature is functionaL. However, if the feature serves no purpose other than as an assurance that a particular entity made, sponsored or endorsed the product, it is
non- functionaL.

To determne whether a product's particular shape or form is functional, you

should consider whether the design as a whole is functional, that is whether the whole collection of elements making up the design or form are essential to the product's use or purpose. You should assess the following factors in deciding if the product feature is functional or non-functional:
1. The Design's Utilitaran Advantage. In considenng this factor, you mal'
examine whether the particular design or product feature yield a utili tan

an

advantage over how the product mi~ht be without that particular design or product feature. If there is a utilitanan advantage from having the particular design or feature, this would weigh in favor of finding the design or feature is functional; if it seems merely ornamental, incidental, or arbitrary it is more likely to be nonfunctional;
2. A vailability of Alternate Designs. In considering this factor, you may

examine whether an alternate design could have been used, so that the competition in the market for that type of product would not be hindered by
allowing. only on e person to exclusivell' use the particular design or

configuration. For this to be answered in the affirmative, the alternatives must be more than merely theoretical or speculative. They must be
commercialll' feasible. The unavailability of a sufficient number of

alternate designs weighs in favor of finding the design or feature is functional;
3. Advertising Utilitaran Advantage in the Design. In considering this factor,

you may examine whether the particular design or configuration has been touted in any advertising as a utiltaran advantage, explicitly or implicitly. If a seller advertises the utiltaran advantages of a particular feature or design, this weighs in favor of finding that design or feature is functional; and
4. The Design's Method of Manufacture. In considering this factor, you may

examine whether the particular design or feature result from a relatively manufacture. If the design or feature is a simple or inexpensive method of result of a particularly economical production method, this weighs in favor of finding the design or feature is functional; if the feature is essential to the use or purpose of the device or affects its cost or quality, it is more likely functional.

The plaintiff has the burden of proving non-functionality by a preponderance of the evidence in order to show that the trade dress is valid and protected from
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infringement.

SOURCE: Ninth Circuit Model Civil Jury Instrctions 15.11 (Modified by including bracketed language suggested in Ninth Circuit Model Civil
Jury Instrctions 15.1 1).

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UNFAIR COMPETITION (LANHAM ACT) FALSE ADVERTISING-BURDEN OF PROOF AND ELEMENTS

On Meritage's claim for false advertising, Merita~e has the burden of proving by a preponderance of the evidence each of the following elements:
i. that Greg Hancock and/or J2H2 caused or assisted in the making of a false

or misleading statement of fact in a commercial advertisement or promotion;
2. that the statement actually deceived or has the tendency to deceive a

substantial segment of its audience;
3. that the deception was m~terial (i.e., likely to influence potential

customers);
4. that the defendant caused the statement to enter interstate commerce; and
5. that Meritage was injured by either the loss of sales or lessening of

goodwil associated with its products.
SOURCE: See Southworks, LLC v. Midwest Industrial Supply, 2007 U.S. Dist.

LEXIS 15832 (D. Ariz. 2007) (No. 06-2141-PHX-DGC); see also
BeUsouth Adver. & Publg Corp. v. Lambert Publg, 45 F. Supp. 2d 1316 (SD Ala. 1999).

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UNFAIR COMPETITION (LANHAM ACT)-DEFENDANT'S PROFITS
In addition to actual damages, Meritage is entitled to any profits eared by the

persons who violated the Lanham Act through trade dress or false advertising violations, which Meritage proves by a preponderance of the evidence. You may not, however, include in any award of profits any amount that you took in account in determning actual damages.
Profit is determined by deducting all expenses from gross revenue.

Gross revenue is all of Rick Hancock Homes's receipts from the sale of homes during the s!lbject period. Meritage has the burden of proving Rick Hancock Homes' gross revenue by a preponderance of the evidence.

Expenses are all overhead and production costs incurred in producing the gross
revenue. Greg Hancock has the burden of proving the expenses and the portion of

the profits attrbutable to factors other than the violations of the Lanham Act by a
preponderance of the evidence.

Unless you find that a portion of the profit from the sale of the homes during the subject period violating the Lanham Act is attributable to factors other than the
Lanham

violation, you shall find that the total profit is attrbutable to the violation of the Act.

SOURCE: Ninth Circuit Model Civil Jury Instrctions 15.26 (Modified by (1) using party names; (2) by using bracketed language suggested in Model Civil Jury Instrctions 15.26; and (3) by using Ninth Circuit the language "homes during the subject period" as the descnption for the "product"). The Instrction is further modified to fit the trade dress and false advertising theories under the Lanham Act and Lanham Act's damages provision in.15 U.S.c. § 1117.

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UNFAIR COMPETITION (LANHAM ACT) DERIV ATIVE LIABILITY-INDUCING A VIOLATION
A person is liable for violating the Lanham Act by another if the

person

intentionally induced another to violate the Lanham Act.

The plaintiff has the burden of proving each of the following by a preponderance of the evidence:
1.

An identifiable person or company violated the Lanham Act;

2.
3.

Greg Hancock and/or J2H2 intentionally induced that person to violate the Lanham Act; and
Meritage was damaged by the violation.

If you find that each of the elements on which Meritage has the burden of proof has been proved, your verdict should be for Meritage. If, on the other hand, Meritage has failed to prove any of these elements, your verdict should be for the defendant.
SOURCE: Ninth Circuit Model Civil Jury Instrctions 15.18 (Modified by (1) using party names and (2) by using bracketed language suggested in
Ninth Circuit Model Civil Jury Instrctions 15.18). The Instruction

is further modified to fit the trade dress and false advertising theories under the Lanham Act.

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UNFAIR COMPETITIONIPALMING OFF (STATE LAW)

In this case, Meritage seeks to recover money damages from Greg Hancock what Meritage claims to be unfair competition by "palming off' homes as those built by Meritage.

SOURCE: Fairway Constructors, Inc. v. Ahern, 193 Ariz. 122,970 P.2d 954
(App. 1998).

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UNFAIR COMPETITIONIP ALMING OFF '(STATE LA W) PALMING OR PASSING OFF

"Palming Off' or "passing off' is a deliberate effort by a person to induce a purchaser to believe that his product is actually the product of another. It requires
that the person have an actual intention to deceive the purchaser. The essences of

"palming off' is an attempt by one person to induce customers to believe that his products are actually those of another.
One person may not sell his own goods under the pretense that they are the goods of another and the law relating to unfair competition forbids such deception.

One who induces another to commit a fraud or ilegal act and furnished the means for doing so is equally responsible and liable.

As a general rule, when one supplies others with the tools for commtting a fraud upon the public or the means by which others are enabled to mislead a purchaser, he is responsible for any palming off, infringement or unfair trade practice that may be caused by these others in using the tools or means supplied to them.
In order for you to find that "palming off' has occurred, it is not necessary for you to find that Greg Hancock acted with any intent to deceive anyone. It is sufficient that there is a likelihood that the public will be confused or deceived.

SOURCE: Fairway Constructors, Inc. v. Ahern, 193 Ariz. 122,970 P.2d 954 (App. 1998); Parkway Baking Co. v. Freihofer Baking Co., 255 F.2d 641 (2d Cir.
1958); Apollo Distributing Co. v. Appollo Imports, Inc., 341 F. Supp. 455 (C.D.N.Y. 1972).

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UNFAIR COMPETITIONIPALMING OFF (STATE LAW) PALMING OR PASSING OFF -- AIDING AND ABETTING TORTIOUS CONDUCT

Meritage claims that Greg Hancock aided and abetted Rick Hancock and Rick Hancock Homes and that Greg Hancock is therefore liable for the consequences of Rick Hancock and Rick Hancock Homes' conduct. On this claim, Meritage must
prove:
1. Rick Hancock and/or Rick Hancock Homes engaged in conduct for which

he is liable to Meritage;
2. Greg Hancock was aware that Rick Hancock and/or Rick Hancock Homes was going to engage in such conduct; and .

3. Greg Hancock provided substantial assistance or encouragement to Rick
Hancock and/or Rick Hancock Homes with the intent of promoting the conduct.

SOURCE: RAJI (Civil) 4th Intentional Tort 23 (modified by adding party
names).

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UNFAIR COMPETITIONIPALMING OFF (STATE LAW) DAMAGES

If you find for Meritage on Meritage's unfair competition/palming off claim, you must determine Meritage's actual damages.

Meritage has the burden of proving actual damages by a preponderance of the evidence. Damages means the amount of money which wil reasonably and fairly compensate Meritage for any injury you find was caused by Greg Hancock
You should consider the following:
1.

The injury to Meritage's reputation;

2.
3.

The injury to Meritage's good